<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1997
Commission file Number 33-22142
REDOX TECHNOLOGY CORPORATION
-----------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 55-0681106
------------------------- ---------------------
State or other jurisdiction of (IRS Employer
incorporation or organization Identification Number)
340 North Sam Houston Parkway East, Suite 250, Houston, Texas, 77060
Tel: (281) 445-0020
Securities registered pursuant to Section 12(b) of the act: NONE
Securities registered pursuant to Section 12(g) of the Act:
COMMON STOCK, PAR VALUE $0.00005 PER SHARE
-------------------------------------------------
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 Days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (Section 229.405 of this chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. [X]
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The aggregate market value of the voting stock held by non-affiliates of the
registrant based on the average bid and asked price of the stock on December 31,
1997 was $51,412,500.
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
Indicate the number of shares outstanding of each of registrant's classes of
common stock, as of the latest practicable date.
CLASS NUMBER OF SHARES OUTSTANDING ON:
--------------- December 31, 1997
Common Stock --------------------------------
par value $0.00005 45,700,000
Convertible Preferred Stock
par value $0.001 6,000,000
DOCUMENTS INCORPORATED BY REFERENCE: None.
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PART I
ITEM 1. BUSINESS.
The company is in its developmental stages and has not yet become
operational. At the present time the company is engaging in
research and development, specializing in new energy technologies
and related new product design and development.
ITEM 2. PROPERTIES.
The Company executed a license agreement with Clark University for
the exclusive use of their patented technology in certain
industries. The Company will pay a royalty to Clark University on
products sold as a result of using the technology.
ITEM 3. LEGAL PROCEEDINGS.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
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PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS.
a) Market Information.
(1) (i) The principal United States market in which the
registrant's Common stock has been traded is the
NASD Over the Counter (OTC) Bulletin Board. The
registrant's Common stock began trading in August,
1993. Through the third and fourth quarters of 1993
the high sales price was $4.00 and the low sales
price was $1.00. The Company's Common stock
was suspended from trading in the First Quarter of
1994 due to delinquencies in certain filings.
Having become current with respect to its filings,
the Company sought a market maker which would
reapply to the NASD to trade the Company's stock.
The Company secured the services of Public
Securities, Inc., Spokane, Washington, in providing
market making services for the stock. Through the
direct efforts of Public Securities, the NASD
approved ReDOX Technology Corporation Common stock
for reinstatement and listing under the symbol "RDOX"
as of May 10, 1995.
(ii) Since reinstatement of trading status in May 1995,
the Company's stock under the symbol "RDOX", has
experienced sales of stock at a high of 5.375 and a
low of .035 per share through December 1997. On
December 31, 1997, the stock closed at 1.125.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATION.
As previously reported, this corporation is in developmental
stages and has not yet become operational or conducted any
business so as to become an income produc ing entity. The
corporation continues to utilize capital borrowed from its
principal shareholder, said capital's recognition as debt or
equity contribution being negotiat ed as provided. Any such debt
is covered by an unsecured Promissory Note, bear ing interest at
the rate of six percent (6%) per annum. The principal and interest
on the Note is due and payable upon vote of the Directors that
payment will not jeopardize the working capital of the
corporation, or five (5) years from date of the Note, or whichever
occurs earlier. As of December 31, 1997 this debt has been
converted to additional Paid-in Capital.
Through December 31, 1997 the corporation had utilized capital
borrowed from its principal shareholder, Richard A. Szymanski.
The amount borrowed by the corporation through December 31, 1994
was $186,023, which included principal and interest. Mr.
Szymanski, as per an agreement with the corporation, provided
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for that entire amount to be contributed as Additional Paid-in
Capital increasing the total Additional Paid-in Capital balance to
$275,026, through December 31, 1994. Through December 31, 1996 an
additional $33,212 was provided by Mr. Szymanski as operating
capital and converted to Additional Paid-in Capital bringing the
balance up to $308,238. During 1996 an additional $80,636 was
provided Mr. Szymanski bringing the balance up to $393,922. During
1997, Mr. Szymanski provided $89,487 of operating capital and
converted to Paid-in Capital, bringing the balance to $483,409.
ITEM 7. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Registrant's financial condition has not changed materially from
December 31, 1996 to date herewith provided. To the extent that
the Company has incurred continuing expenses without any revenues
having been generated, shareholders' equity would have suffered
proportionately had it not been for the continuing infusion of
capital from the Company director Richard Szymanski. Because of
the absence of revenues and the inability thus far to raise the
capital necessary to commence manufacturing operations, there are
no assurances that the Company will be able to fully carry out its
plans, and continue as a going concern.
See Exhibit 99.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
None.
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PART III
ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
(a) (b) Directors and Officers: Identification of Directors and
Officers.
The members of the Board of Directors of the company are elected
by the shareholders at each annual meeting for a one year term.
Officers are elected by the Directors at each annual meeting for a
one year term, or until otherwise replaced by the Board of
Directors. The following table sets forth certain information with
respect to the Officers and Directors of the company.
<TABLE>
<CAPTION>
NAME AGE OTHER OFFICE HELD TERM PERIOD SERVED
---- --- ----------------- ---- -------------
<S> <C> <C> <C> <C>
Richard Szymanski 56 President/Director 1 Year 60 Months
Clifton D. Douglas 67 Secretary/Treasurer/Director 1 Year 18 Months
Clifford A. Jones 85 Secretary/Director 1 Year 55 Months
</TABLE>
(c) Identification of Certain Significant Employees. None.
(d) Family Relationships of All Officers and Directors. None.
(e) Business Experience of All Officers and Directors.
1) Background during last 5 years.
Richard A. Szymanski served as an executive officer and
Director of the corporation since April 1993. Mr.
Szymanski has over 28 years experience in pioneering the
use of computers for printing, publishing, typesetting
and layout; supervising the writing, illustration,
publishing and photography of major world events; and
more recently the development and improvement of high
density power sources.
Clifton D. Douglas has served as Secretary/Treasurer and
Director since July 1996. Mr. Douglas has previously
been the Chief Financial Officer of Tesoro Distributing
Company, Diamond M Drilling, Oil Base Inc., all of which
were oilfield related. In the most recent years he has
been self-employed as a financial consultant. In
addition he has ownership in several oilfield supply
companies.
Clifford A. Jones has served as Secretary and Director
of the Corporation since April, 1993. Mr. Jones was
the founder and Senior Partner of the firm of Jones,
Close and Brown, Chartered Attorney-at-Law, in Las
Vegas, Nevada, where he has been practicing law for the
past 39 years. Mr. Jones served as Lieutenant Governor
of the State of Nevada for two consecutive terms, and
is listed in "Who's Who in American Law" and "Who's
Who in the World."
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(2) Directorships.
(a) Clifford A. Jones also serves as a Director of the
following public corporation:
(i) 18 Greenway Environmental Services,Inc.
(f) Involvement in Certain Legal Proceedings. None.
(g) Promoters and Control Persons. None.
ITEM 10. EXECUTIVE COMPENSATION.
None
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
(a) Certain Beneficial Owners.
(1) Title of (2) Name and Address (3) Amount Nature of (4) Percent
Class of Beneficial Owner Beneficial Ownership of Class
- ------------ -------------------- -------------------- -----------
Richard Szymanski
Common Stock 15 White Oak Manor 14,904,524 shares 32.60%
Conroe, Texas 77304
(b) Security Ownership of Management.
(1) Title of (2) Name (3) Amount Nature of (4) Percent
Class of Beneficial Owner Beneficial Ownership of Class
- ------------ ------------------- -------------------- -----------
Common Stock Richard Szymanski 14,904,524 shares 32.60%
Common Stock Clifton D. Douglas 1,000,000 shares 2.20%
Common Stock Clifford A. Jones 1,000,000 shares 2.20%
Note: As a group, the officers and directors beneficially own approximately
16,904,524 Shares.
Changes in Control. None.
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PART IV
ITEM 12. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K.
(a) The following documents are filed as a part of the report:
(1) Articles of Incorporation of DCUSA Corporation
(2) By-Laws of ReDox Technology Corporation
(3) Financial Statements
(b) Exhibits:
(1) Articles of Incorporation of DCUSA Corporation (Exhibit 3.i)
(2) By-Laws of ReDox Technology Corporation (Exhibit 3.ii)
(3) Financial Statements (Exhibit 99)
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Security Exchange Act
of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
REDOX TECHNOLOGY CORPORATION
By: /s/ Richard A. Szymanski
-------------------------------------------
Richard A. Szymanski / President / Director
Date: March 15, 1998
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following person on behalf of the registrant in the
capacities and on the dates indicated.
By: /s/ Clifton D. Douglas
-------------------------------------------
Clifton D. Douglas/Director
Date: March 15, 1998
By: /s/ Clifford A. Jones
-------------------------------------------
Clifford A. Jones/Director
Date: March 15, 1998
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EXHIBITS INDEX
The Exhibits referred to herein and attached hereto are more particularly
described below. In addition, certain other Exhibits have been attached hereto,
as supplementary information, which may assist in further understanding of the
overall information presented.
DESCRIPTION OF EXHIBITS (SUPPLEMENTAL OR OTHERWISE) SUBMITTED
EXHIBIT
NO. DESCRIPTION OF EXHIBIT
------- ----------------------
3.i Articles of Incorporation of DCUSA Corporation
3.ii By-Laws of ReDox Technology Corporation
99 Financial Statements, December 1997
27 Financial Data Schedule
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EXHIBIT 3.i
CERTIFICATE OF INCORPORATION
DCUSA CORPORATION
-----------------
1. The name of the corporation is DCUSA CORPORATION.
2. The address of its registered office in the State of Delaware is
Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County
of New Castle. The name of its registered agent at such address is The
Corporation Trust Company.
3. The nature of the business or purpose to be conducted or promoted
is: To engage in any lawful act or activity for which corporations may be
organized under the General Corporation Law of Delaware.
4. The total number of shares of stock which the corporation shall have
authority to issue is Twenty-five million shares (25,000,000) and the par value
of each such shares is One Ten Thousandth of a Dollar ($.0001) amounting in the
aggregate to Two Thousand Five Hundred Dollars ($2,500).
5. The name and mailing address of each incorporator is as follows:
NAME MAILING ADDRESS
---- ---------------
L. J. Vitalo Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
J. A. Grodzicki Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
D. A Hampton Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
6. The corporation is to have perpetual existence.
7. In furtherance and not in limitation of the powers conferred by
statute, the board of directors is expressly authorized:
To make, alter or repeal the by-laws of the corporation.
8. Elections of directors need not be by written ballot unless the
by-laws of the corporation shall so provide.
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Meetings of stockholders may be held within or without the State of
Delaware, as the by-laws may provide. The books of the corporation may be kept
(subject to any provision contained in the statues) outside the State of
Delaware at such a place or places as may be designated from time to time by the
board of directors or in the by-laws of the corporation.
9. The corporation shall indemnify its officers, directors, employees
and agents to the extent permitted by the General Corporation Law of Delaware.
10. The corporation reserves the right to amend, alter, change or
repeal any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
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WE, THE UNDERSIGNED, being each of the incorporators hereinbefore
named, for the purpose of forming a corporation pursuant to the General
Corporation Law of the State of Delaware, do make this certificate, hereby
declaring and certifying that this is our act and deed and the facts herein
stated are true, and accordingly have hereunto set our hands this 25th day of
April, 1988
/s/ L. J. Vitalo
--------------------------
L. J. Vitalo
/s/ J. A. Grodzicki
--------------------------
J. A. Grodzicki
/s/ D. A. Hampton
--------------------------
D. A. Hampton
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Received for Record
April 26th, A.D. 1988
William M. Honey, Recorder.
STATE OF DELAWARE :
: SS.:
NEW CASTLE COUNTY :
Recorded in the Recorder's Office at
Wilmington, Vol. _________ Page ____ &c.,
the 26th day of April, A. D. 1988.
Witness my hand and official seal.
/s/ William M. Honey
---------------------
Recorders.
Recorders Office
New Castle Co. Del.
Mercy Justice
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<PAGE> 1
EXHIBIT 3.ii
BY-LAWS OF REDOX TECHNOLOGY CORPORATION
BY-LAWS OF
REDOX TECHNOLOGY CORPORATION
Article I
OFFICES
The principal business office of the Corporation shall be located in the City of
Houston in the State of Texas. The Corporation may relocate its principal office
or have such other offices within the United States of America as the Board of
Directors may designate or as the business of the Corporation may require from
time to time.
Article II
SHAREHOLDERS
Section 1. Annual Meeting. The Annual Meeting of the Shareholders shall be held
on the Second Monday of May in each year, beginning with the year subsequent to
the Board of Directors' Declaration that the Company has become operational, for
the purpose of electing Directors and for the transaction of such other business
as may come before the meeting. If the election of Directors shall not be held
on the day designated herein for any Annual Meeting of the Shareholders, or at
any adjournment thereof, the Board of Directors shall cause the election to be
held at a Special Meeting of the Shareholders as soon thereafter as conveniently
may be.
Section 2. Special Meetings. Special Meetings of the Shareholders, for any
purpose, unless otherwise prescribed by statute, may be called by a President or
by the Directors, or by the holders of not less than Ten percent (10%) of all
the outstanding shares of the Corporation entitled to vote a such meeting.
Section 3. Place of Meeting. The Board of Directors may designate any place,
within or without the State of Incorporation, unless otherwise prescribed by
statute, as the place of meeting of any Annual or Special Meeting called by the
Board of Directors, if no designation is made, or if a Special Meeting is
otherwise called, the place of meeting shall be the principal office of the
Corporation.
Section 4. Notice of Meeting. Written notice stating the place, day, and hour of
the meeting, and for Special Meetings, the purpose for which the meeting is
called, shall, unless otherwise prescribed by statute, be delivered not less
than ten (10) nor more than fifty (50) days before the date of the meeting,
either personally or by mail, by direction of the Chairman or the Secretary, or
the persons calling the meeting, to each shareholder of record entitled to vote
at such meeting. If mailed, such notices shall be deemed to be delivered when
deposited in the United States mail, addressed to the shareholder at his or her
address as it appears on the stock transfer books of the Corporation.
Section 5. Closing of Transfer Books or Fixing of the Record Date. For the
purpose of determining shareholders entitled to notice of or to vote at any
meeting of shareholders or adjournment thereof, or shareholders entitled to
receive payment of any dividend, or in order to make a determination of
shareholders for any other purpose, the Board of Directors of the Corporation
may provide that the stock transfer books shall be closed for the purpose of
determining shareholders entitled to notice of or to vote at a meeting on the
date on which the resolution of the Board of Directors declaring such dividend,
as the case may be, and this date shall be the record date for such
determination of shareholders. When a determination of shareholders entitled to
vote at any meeting of shareholders has been made as provided in this Section,
such determination shall apply to any adjournment thereof.
Section 6. Voting Lists. The officer or agent having charge of the stock
transfer books for shares of the Corporation shall make available a complete
list of the shareholders entitled to vote at any meeting of shareholders or any
adjournment thereof, with the address of and the number of shares held by each,
at least ten (10) days before such meeting or adjournment thereof. Such list
shall also be produced and kept open at the time and place of the meeting and
shall be subject to the inspection of any shareholder during the meeting.
Section 7. Quorum. The majority of the outstanding shares voting of the
Corporation that are entitled to vote, represented in person or by proxy, shall
constitute a quorum at a meeting of shareholders. At such meeting at which a
quorum shall be present or represented, any business may be transacted at the
meeting as originally noticed. The majority of shareholders present at the
meeting may continue to transact business until adjournment.
Section 8 Proxies. At all meetings of shareholders, a shareholder may vote in
person or by proxy executed in writing by the shareholder or by his or her duly
authorized attorney in fact. Such proxy shall be filed with the Secretary of the
Corporation before or at the the time of the meeting.
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BY-LAWS OF REDOX TECHNOLOGY CORPORATION
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Section 9. Voting of Shares. Subject to the provisions, each outstanding share
eligible to vote shall be entitled to one ( I) vote upon each matter submitted
to a vote at a meeting of the shareholders. Upon demand of any stockholder, the
vote for directors or upon any question before the Meeting shall be by ballot.
All elections for directors shall be decided by expressed will of the quorum,
except when a quorum is not obtained, in which case the will of a plurality
shall carry. All other questions shall be decided by quorum vote except as
otherwise provided by the Certificate of Incorporation or the laws of the State
of Incorporation.
Section 10. Voting of Shares by Certain Shareholders. Shares outstanding in the
name of another corporation may be voted by such officer, agent, or proxy as the
by-laws of such corporation may prescribe, or, in the absence of such provision,
as the board of directors of such corporation shall determine.
Shares held by an administrator, executor, guardian, or server may be voted by
him or her, either in person or by proxy, without transfer of shares into his or
her name. Shares outstanding in the name of a trustee may be voted by him or by
her, either in person or by proxy, but no trustee shall be entitled to vote
shares held by him or her without a transfer of such shares into the name of the
trustee.
Shares outstanding in the name of a receiver may be voted by such receiver, and
shares held by or under the control of a receiver may be voted by the same
without the transfer thereof into his or her name if authority to do so is
contained in an appropriate order of the court by which such receiver was
appointed; such court order shall be presented to the Secretary of the
Corporation before the shares are voted.
A shareholder whose shares are pledged shall be entitled to vote such shares
until the shares have been transferred from the name of the shareholder to
another.
Shares of its own stock belonging to the Corporation shall not be voted,
directly or indirectly, at any meeting, and shall not be counted in determining
the total number of outstanding shares at any given time.
Section 11. Informal Action by Shareholders. Unless otherwise provided by law,
any action required to be taken at a meeting of the shareholders, or any other
action which may be taken at a meeting of the shareholders, may be taken without
a meeting if a consent in writing, setting forth the action so taken, shall be
signed by all of the shareholders entitled to vote with respect to the subject
matter thereof.
Section 12. Non-cumulative Voting. Unless otherwise provided by law, at each
election of Directors, every shareholder entitled to vote in such election shall
have the right to vote, in person or by proxy, the number of shares owned by him
or her for as many persons as there are Directors to be elected and for whose
election he or she has a right to vote.
Section 13. Order of Business. The order of business at all meetings of
stockholders shall be as follows: I) Roll Call; 2) Proof of notice of meeting or
waiver of notice; 3) Reading of minutes of previous meeting; 4) Reports of
Officers; 5) Reports of Committees; 6) Election of Directors; 7) Unfinished
Business; 8) New Business.
Article III
BOARD OF DIRECTORS
Section 1. General Powers. The business and affairs of the Corporation shall be
managed by its Board of Directors.
Section 2. Number, Tenure, and Qualifications. The number of Directors shall not
be less than three (3) nor more than nine (9) as directed by the Board of
Directors. Each Director shall hold office until the next Annual Meeting of the
Shareholders and until a successor has been elected and qualified. Additional
Directors may be added by majority vote of the then-existing Board.
Section 3. Regular Meetings. A regular meeting of the Board of Directors shall
be held, without other notice than this By-law, immediately after, and at the
same place as, each Annual Meeting of the Shareholders. The Board of Directors
shall hold a regular meeting on the First day of each month, without notice of
meeting other than this Article and Section of these By-laws.
Section 4. Special Meetings. Special meetings of the Board of Directors may be
called by or at the request of any Director. The person(s) authorized to call
such a special meeting of the Board of Directors may fix the place for holding
such meetings.
Section 5. Notice. Notice of any special meeting of the Board of Directors shall
be given at least ten (10) days previous thereto by written notice delivered
personally or by certified mail, return receipt requested, which notice shall be
deemed to be delivered when
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BY-LAWS OF REDOX TECHNOLOGY CORPORATION
- -------------------------------------------------------------------------------
deposited in the United States mail. Any Director may waive notice of any
meeting. The attendance of a Director at a meeting shall constitute a waiver of
notice for such meeting, except where a Director attends a meeting for the
express purpose of objecting to the transaction of business because the meeting
was not lawfully called or convened.
Section 6. Quorum. A majority of the number of Directors fixed by these By-laws
shall constitute a quorum for the transaction of business at any meeting of the
Board of Directors, but if less than a majority is present at a meeting, the
majority of the Directors present may adjourn the meeting from time to time
without further notice.
Section 7. Manner of Acting. The act of the majority of the Directors present
at a meeting at which a quorum is present shall be the act of the Board of
Directors.
Section 8. Action Without Meeting. Any action that may be taken by the Board of
Directors at a meeting may be taken without a meeting if written consent setting
forth the action to be taken shall be signed before such action by a majority of
the Directors.
Section 9. Vacancies. Any vacancy occurring in the Board of Directors may be
filled by the affirmative vote of the majority of the remaining Directors,
though possibly less than a quorum of the Board of Directors, unless otherwise
prohibited by law. A Director elected to fill a vacancy shall be elected for the
unexpired term of his or her predecessor in office. Any directorship to be
filled by reason of an increase in the number of Directors may be filled by the
Board of Directors for a term of office continuing only until the next election
of Directors by the shareholders.
Section 10. Compensation. By resolution of the Board of Directors, each Director
may be reimbursed for expenses of attending any meeting and may be paid at a
stated salary as a Director, or at a fixed sum for attendance at each meeting of
the Board of Directors or both. No such payment shall preclude any Director from
serving the Corporation in any other capacity and receiving compensation
therefrom.
Section 11. Presumption of Assent. A Director who is present at a meeting of the
Board of Directors at which any action or corporate matter is taken shall be
presumed to have assented to the action taken unless his or her dissent shall be
entered into the minutes of the meeting or unless he or she shall file his or
her dissent with the person acting as the Secretary of the meeting before the
adjournment of the meeting or within three (3) days thereafter. Such right of
dissent shall not apply to any Director who voted in favor of such action.
Section 12. Special Powers. The Board of Directors shall have the right to
re-incorporate the Company, to declare splits or reverse splits of the stock of
the Company, or otherwise act on matters concerning the corporate status and
capital structure of the Company.
Article IV
STRUCTURE OF THE BOARD OF DIRECTORS
Section 1. Nominative Offices. The named offices of the Board of Directors shall
be that of a President, at least one Vice President, a Treasurer, and a
Secretary. A single Director may hold more than one named office, but not more
than two for any period of more than one (I) month. Such Directors as do not
hold a named office shall be called and considered Members-at-Large of the Board
of Directors.
Section 2. Election and Term of Office. The named offices of the Board of
Directors shall be filled by election of the Board of Directors at the Annual
Meeting of Shareholders. The term of office shall coincide with the term of
directorship, or, by appointment by the Board of Directors to fill a vacancy
caused by the resignation, death, or removal from office of a Director who holds
a named office, only for the unexpired term of that Director, until the next
election of Directors by the shareholders. A candidate for election to the Board
of Directors shall be presented with the named office, if any, to the
shareholders for their votes.
Section 3. President. The President shall be the chief executive officer of the
Corporation and, subject to the control of the Board of Directors, shall control
all business affairs of the Corporation including, but not restricted to,
routine purchasing of inventory, sales and marketing strategies pursued, hiring
and firing of employees of the Corporation, determination of salaries of
employees, risk management, etc., and the devolution of any of these duties to
subordinates as he or she deems necessary and appropriate. He or she shall
execute the decisions of the Board of Directors in a timely manner, or on any
other relevant Corporate matter, as Directors or any Director shall dictate,
within the bounds of these By-laws.
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BY-LAWS OF REDOX TECHNOLOGY CORPORATION
- -------------------------------------------------------------------------------
Section 4. Vice President. A Vice President of the Corporation shall carry out
such duties as prescribed by the Board of Directors in the appointment of him or
her to the position. A Vice President may, at the discretion of the Board of
Directors upon his or her appointment, be designated with a prefix title (e.g.
"Senior"), and may be assigned a suffix descriptor of his or her general or
specific area of activity or activities (e.g. "Marketing"). In general, a Vice
President shall report directly to the President, but may from time to time
report directly to the Board of Directors if expressly requested to do so by the
Board of Directors or any Director.
Section 5. Secretary. The Secretary shall: (a) keep the minutes of the
proceedings of the shareholders and the Board of Directors; (b) see that all
notices are duly given in accordance with the provisions of these By-laws or as
required by law; (c) be custodian of the corporate records and of the seal of
the Corporation; (d) keep a register of the post office address of each
shareholder which shall be furnished to the Secretary by such shareholder; (e)
sign, with the President, certificates for shares of the Corporation which have
been authorized by the Board of Directors or the shareholders; (f) have general
charge of the stock transfer books of the Corporation; and (g) in general
perform all duties incident to the office of Secretary and such other duties as
from time to time may be assigned to him by the Chairman or the Board of
Directors
Section 6. Treasurer. The Treasurer shall: (a) have custody of and be
responsible for all funds and securities of the Corporation; (b) receive and
give receipts for all money due and payable to the Corporation, and deposit all
such moneys in the name of the Corporation in such banks or other depositories
as shall be designated by the Board of Directors; and (c) in general perform all
of the duties incident to the office of the Treasurer and which may be assigned
to him or her from time to time by the Chairman of the Board.
Section 7. Chairman of the Board of Directors. The Chairman of the Board of
Directors shall preside at all meetings of the Corporation or adjournments
thereof. The Chairman of the Board shall be elected by, and serve exclusively at
the discretion of, the Board of Directors, and shall serve a term co-incident
with that of all other Board members. The Chairman of the Board of Directors
shall be the spokesperson for the Board of Directors, unless he or she assigns
this duty to another Director. The Chairman of the Board of Directors shall have
no special powers other thaw those explicitly described in this Article.
Section 8. Salaries. The salaries of the named Directors shall be fixed from
time to time by the Board of Directors, and no such Director shall be prevented
from receiving such salary because he is a Director or otherwise an Officer as
described in this Article, or employed in some other capacity by the
Corporation.
Article V
CONTRACTS, LOANS, CHECKS, AND DEPOSITS
Section 1. Contracts. The Board of Directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute and deliver any
instrument in the name of and on behalf of the Corporation, and such authority
may be general or limited to specific events.
Section 2. Loans. No loans shall be contracted on behalf of the Corporation and
no evidence of indebtedness shall be issued in its name unless authorized by a
resolution of the Board of Directors. Such authority may be general or limited
to specific areas or events.
Section 3. Checks, Drafts, et Cetera. All checks, drafts, or other orders for
payment of money, notes, or other evidence of indebtedness issued in the name of
the Corporation shall be signed by the President, acting in his capacity as the
chief executive officer of the Corporation, and the Treasurer, or such officer
or officers or agent or agents of the Corporation and in such manner as from
time to time shall be determined by resolution of the Board of Directors.
Section 4. Deposits. All funds of the Corporation not otherwise employed shall
be deposited from time to time to the credit of the Corporation in such bank or
other depositories as the Board of Directors shall designate.
Article VI
CERTIFICATES OF SHARES AND THEIR TRANSFER
Section 1. Certificates of Shares. Certificates representing shares of the
Corporation shall be in such form as shall be determined by the Board of
Directors. Such certificates shall be signed by either the President in his
capacity as the chief executive officer of the Corporation, and by the
Secretary, or by such other officer or officers as shall be authorized by the
Directors in conformity with applicable law, and sealed with the corporate seal.
All certificates for shares issued, with the number of shares and date of
Page -4-
<PAGE> 5
BY-LAWS OF REDOX TECHNOLOGY CORPORATION
- -------------------------------------------------------------------------------
issue, shall be entered on the transfer books of the Corporation. All
certificates surrendered to the Corporation for transfer shall be cancelled,
except that in the case of a lost, destroyed, or mutilated certificate a new one
may be issued therefor upon such terms and indemnity to the Corporation as the
Board of Directors may prescribe.
Section 2. Transfer of Shares. Transfer of shares of the Corporation shall be
made only on the stock transfer books of the Corporation by the holder of the
record thereof or by his or her legal representative(s), who shall furnish
proper evidence of the authority to transfer, or by his or her duly authorized
attorney, and on surrender for cancellation of the certificate(s) of such
shares. The person or other entity in whose name the shares stand on the books
of the Corporation shall be deemed by the Corporation to be the owner thereof
for all purposes.
Article VII
FISCAL YEAR
The fiscal year of the Corporation shall end on the last day of December of each
year.
Article VIII
DIVIDENDS
The Board of Directors may from time to time declare, and the Corporation may
pay, dividends on its outstanding shares in the manner and upon the terms and
conditions provided by law and the Articles of its Certificate of Incorporation,
except that no such dividend shall be paid except from accrued profits.
Article IX
CORPORATE SEAL
The Directors, at their discretion, may provide a corporate seal which shall be
circular in form and shall have inscribed thereon the name of the Corporation,
the state of incorporation, year of incorporation, and the words "Corporate
Seal."
Article X
WAIVER OF NOTICE
Unless otherwise provided by law, whenever any notice is required to be given to
any shareholder or Director of the Corporation, a waiver thereof in writing,
signed by the person entitled to such notice, whether before or after the time
stated therein, shall be deemed equivalent to the giving of such notice.
Article XI
AMENDMENTS
These By-laws may be altered or amended or replaced by the Board of Directors at
any meeting thereof.
Page -5-
<PAGE> 6
BY-LAWS OF REDOX TECHNOLOGY CORPORATION
- -------------------------------------------------------------------------------
I, Richard A. Szymanski, the sole and only Director of the Corporation, hereby
certify that the foregoing By-laws of REDOX Technology Corporation, constituting
Eleven (11) Articles on the first Five (5) of these Six (6) pages, were approved
by unanimous vote at a Special Meeting of the Board of Directors of REDOX
Technology Corporation, held on the First day of June, Nineteen Hundred
Ninety-three.
/s/ Richard A. Szymanski, Director
-----------------------------------
Page -6-
<PAGE> 1
EXHIBIT 99
WANT & ENDER, CPA, P.C.
- -------------------------------------------------------------------------------
CERTIFIED PUBLIC ACCOUNTANTS 37 East 28th Street, 8th Floor
New York, NY 10016
MARTIN ENDER, CPA Telephone (212) 684-2414
STANLEY Z. WANT, CPA, CFP Fax: (212) 684-5433
INDEPENDENT AUDITOR'S REPORT
To the Shareholders and Board of Directors:
REDOX TECHNOLOGY CORPORATION
We have audited the accompanying balance sheet of REDOX TECHNOLOGY CORPORATION
at December 31, 1997 and the related statements of income and retained earnings,
stockholders' equity and cash flows for the year then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We have conducted our audit in accordance with generally accepted auditing
standards. These standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit also includes examining on a test basis, evidence
supporting the amounts and diclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe our audit provides a reasonable basis for our opinion.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The Company has not yet begun
operations, and as such, has sustained recurring losses. In our opinion, the
financial statements referred to above present fairly, in all material respects,
the financial position of REDOX TECHNOLOGY CORPORATION at December 31, 1997, and
the results of its operations and its cash flows for the year then ended in
conformity with generally accepted accounting principles.
/s/ Martin Ender
- ----------------------------
Martin Ender
Want & Ender CPA, P.C.
Certified Public Accountants
New York, NY
March 11, 1998
F-1
<PAGE> 2
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
- -------------------------------------------------------------------------------
BALANCE SHEET
as of
December 31, 1997
ASSETS
CURRENT ASSETS:
Cash on Hand $ 242.26
-------------
TOTAL CURRENT ASSETS $ 242.26
-------------
FIXED ASSETS: (See Note 3)
Office Equipment $ 8,394.76
Accumulated Depreciation: Office Equipment (6,718.00)
Furniture & Fixtures 20,302.74
Accumulated Depreciation: Furn. & Fixt. (14,400.00)
-------------
TOTAL FIXED ASSETS $ 7,579.50
-------------
OTHER ASSETS:
License Agreement (See Note 12) $ 20,000.00
Patent (See Notes 4 and 9) 1,500.00
Security Deposits 1,159.10
Goodwill (See Note 5) 50,000.00
Organization Costs 250.00
(Net of accumulated amortization $500)
-------------
TOTAL OTHER ASSETS $ 72,909.10
-------------
-------------
TOTAL ASSETS $ 80,730.86
=============
F-2
<PAGE> 3
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
- -------------------------------------------------------------------------------
BALANCE SHEET
as of
December 31, 1997
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts Payable $ 1,698.60
--------------
STOCKHOLDERS' EQUITY:
Common Stock, par value $.00005 per share
100,000,000 authorized. 45,700,000 issued and
outstanding.(See Notes 6 and 11) $ 2,285.00
Convertible Preferred Stock, par value $.001
10,000,000 shares authorized. 6,000,000 shares
issued and outstanding. 6,000.00
Additional Paid-in Capital (See Notes 6 and 11) 478,346.71
Accumulated Deficit - December 31, 1997 (407,599.45)
-------------
Total Stockholders' Equity $ 79,032.26
TOTAL LIABILITIES AND EQUITY $ 80,730.86
==============
F-3
<PAGE> 4
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
- -------------------------------------------------------------------------------
STATEMENT OF INCOME AND RETAINED EARNING
for the year ending
December 31, 1997
INCOME:
Revenues $ 108.67
--------------
TOTAL REVENUES $ 108.67
--------------
EXPENSES:
Auto Expense $ 1,283.39
Dues and Subscriptions 5,375.70
Office Expenses 8,282.65
Professional Fees 20,818.41
Rent 16,316.97
Telephone Expenses 5,221.99
Local Travel 6,831.25
Miscellaneous Tax 227.05
Public Relations 3,069.62
Interest 1.21
Travel and Entertainment 920.87
Depreciation 5,280.00
Amortization 0.00
--------------
TOTAL EXPENSES $ 73,629.11
--------------
NET INCOME/(LOSS) FOR THE PERIOD $ (73,520.44)
ACCUMULATED DEFICIT - JANUARY 1, 1997 $ (334,079.01)
--------------
--------------
ACCUMULATED DEFICIT - DECEMBER 31, 1997 $ (407,599.45)
==============
F-4
<PAGE> 5
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
- -------------------------------------------------------------------------------
STATEMENT OF STOCKHOLDERS' EQUITY
as of
December 31, 1997
COMMON STOCK - $.00005 par value
Authorized - 100,000,000 shares
Issued - 45,400,000 shares $ 2,270.00
Addtional Paid-in Capital 388,875.13
Accumulated Deficit (334,079.01)
---------------
---------------
STOCKHOLDERS' EQUITY - JANUARY 1, 1997 $ 57,066.12
===============
COMMON STOCK: Issued - 300,000 15.00
PREFERRED STOCK: Issued - 6,000,000 $ 6,000.00
Addtional Paid-in Capital (See Note 6) 89,471.58
Net profit/(loss) for the period
January 1, 1997 to December 31, 1997 (73,520.44)
---------------
---------------
STOCKHOLDERS' EQUITY - DECEMBER 31, 1997 $ 79,032.26
===============
F-5
<PAGE> 6
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
- -------------------------------------------------------------------------------
STATEMENT OF CASH FLOW
for year ended
December 31, 1997
Current Year
12-31-97
Cash Flows from Operating Activities
NET INCOME $ (73,520.44)
--------------
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Depreciation and Amortization $ 5,280.00
Increase/(Decrease) in Accounts Paybles 1,133.60
--------------
Total Adjustments $ 6,413.60
--------------
NET CASH PROVIDED (Used) BY OPERATING ACTIVITIES $ (67,106.84)
--------------
Cash Flows from Investing Activities
Cash Payments for the Purchase of Property $ (2,302.74)
(Increase)/Decrease in Other Assets (20,000.00)
--------------
NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES $ (22,302.74)
--------------
Cash Flows from Financing Activities
Proceeds from Issuance of Common Stock $ 15.00
Proceeds from Additional Paid-in Capital 89,471.58
--------------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES $ 89,486.58
Net Increase/(Decrease) in Cash $ 77.00
Cash at Beginning of Period 165.26
--------------
CASH AT END OF PERIOD $ 242.26
==============
F-6
<PAGE> 7
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
December 31, 1997
NOTE 1. NATURE OF BUSINESS
REDOX TECHNOLOGY CORPORATION, was incorporated on April 25, 1988, under the laws
of the State of Delaware. The original name of the corporation was DCUSA
CORPORATION. DCUSA Management referred to the company as a "blind pool" or
"blank check" company. Its primary business was to obtain an acquisition and/or
merger transaction whereby its stockholders would benefit. On June 1, 1993, the
name of the corporation was changed to REDOX TECHNOLOGY CORPORATION. During
1993, the Company acquired a pending patent and all rights thereto which REDOX
Management intends to develop for commercial purposes.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
INCOME TAXES:
The Company is currently operating at a loss. It has therefore not
provided for income taxes.
ORGANIZATION COSTS:
The Company has capitalized the costs of organization and registration
of its securities. Amortization is computed on a straight-line basis
over sixty months commencing April 25, 1988. The Company is no longer
amortizing its organizational costs. These costs will be written off at
such time that it may be determined that the company has been
unsuccessful in its efforts to attract a suitable partner.
NOTE 3. FIXED ASSETS
In January 1994, the Company received furniture and office equipment from Mr.
Richard Szymanski as part of a Sale Contract and Bulk Transfer Agreement between
Mr. Szymanski and the Company. The assets have been recorded in the books at
their fair market value of $25,000.
NOTE 4. PATENT ACQUISITION
On April 9, 1993 the Company acquired all interest in a U.S. Patent Pending
application titled "EMERGENCY RESERVE BATTERY". It involves high density energy
technology to enhance battery cells. The rights to the patent pending were
acquired in exchange for fifteen million (15,000,000) shares of par value .0001
per share, with actual value of the intellectual property so acquired to be
determined by an independent agency. For purpose of financial statements, the
value is shown as $1,500. Management decided to record the property on the books
at the aggregate par value $1,500. The value of this property is computed at
$5,200,000. This value has been determined by Battelle Memorial Institute which
is an independent valuation agency.
F-7
<PAGE> 8
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
December 31, 1997
NOTE 4. PATENT ACQUISITION (continued)
On August 18, 1997, REDOX executed an exclusive agreement with Clark University,
an option to elect a royalty bearing, limited terms, license to the Patent
Rights in the novel Aluminum-Sulfur Battery developed by Stuart Licht at Clark
University.
Such exclusivity to apply to the electronics industry and for space
applications. The company paid $20,000.00 for the exclusive use of these patents
for the electronics industry and space application.
NOTE 5. GOODWILL
This represents amounts paid for the acquisition of DCUSA Corporation by Richard
Szymanski. This is reflected on the books as Additional Paid-In Capital.
NOTE 6. COMMON STOCK
On April 9, 1993, the number of outstanding shares of the Company's Common Stock
was increased by fifteen million (15,000,000) shares. These fifteen million
(15,000,000) shares were issued to Richard A. Szymanski in exchange for
assignment of all rights to the pending patent application (See Note 4 above).
On July 1, 1996, the Board of Directors approved and issued a stock option to
purchase 1,000,000 shares to C. D. Douglas, said option to be exercised by July
1, 1998. Said option was exercised by Mr. Douglas.
NOTE 7. ADDITIONAL PAID-IN CAPITAL
The cost of furniture and equipment acquired during the year was $0 (See Note
3). The fair market value has been determined at $25,000. The corporation has
decided to record the asset in the books at the fair market value. The
difference between the acquisition cost and the fair market value has therefore
been transferred to additional paid-in capital.
As of March 31, 1994, the corporation was utilizing capital borrowed from its
principal shareholder, Richard A. Szymanski. The principal and interest due on
the note as of December 31, 1993 was $88,358, and the principal and interest due
as of March 31, 1994 was $120,539, there having been an additional $32,181
accrued during the first quarter 1994. As per an agreement with Mr. Szymanski,
the entire balance due to him was converted to Additional Paid-In Capital. For
all of 1994, that amount was $186,023, there has been $153,842 directly posted
to Additional Paid-In Capital during the second, third, and fourth quarters of
1994, in addition to the $32,181 transferred thereto from the first quarter of
1994. During 1995 an additional $33,212 has been contributed to Additional
Paid-In Capital by Richard A. Szymanski. During 1996 an additional amount of
$80,636 was contributed to Additional Paid-In Capital by Richard Szymanski. For
the year ending December 31, 1997 an additional amount of $89,457 has been
contributed by Richard Szymanski.
F-8
<PAGE> 9
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
- -------------------------------------------------------------------------------
NOTE 8. CHANGE OF FISCAL YEAR
On June 16, 1993, the Board of Directors approved the change of fiscal year of
the corporation from beginning on June 1 and ending on May 31, to beginning on
January 1 and ending December 31.
NOTE 9. ALTERATIONS TO PREVIOUS FINANCIAL STATEMENTS FOR THE SAME PERIOD.
The original audited balance sheet as of March 31, 1994, recognized the patent
at its fair market value of $5,200,000 (See Note 4), with the corresponding
value assigned to Additional Paid-In Capital. Management decided to revise the
March 31, 1994 financial statement to recognize the patent's value at $1,500,
with corresponding value assigned to Additional Paid-In Capital.
NOTE 10. GOING CONCERN
The accompanying financial statements have been prepared on a going concern
basis, which contemplates the realization of assets and the satisfaction of
liabilities in the normal course of business. Because the Company has not yet
commenced operations, it is entirely dependent upon the continued contributions
of capital and other resources provided by its principals until such time as
sufficient capital can be raised from other sources (e.g. from the sale of the
Company's authorized but unissued Common stock) to commence production for sale
of its products. Therefore, the assumption that the Company is a going concern,
is entirely determined upon the uncertain ability of the Company to raise
capital in such an amount as would be necessary to commence operations and
produce sufficient cash flow therefrom to survive.
NOTE 11. ADJUSTMENTS TO STOCKHOLDERS' EQUITY ENTRIES
The sum of Fifteen Dollars ($15.00) has been transferred from Additional Paid-In
Capital to Common Stock at Par Value. This has been done to reflect the par
value of all of the Company's Common Stock outstanding.
The sum of Six Thousand Dollars ($6,000) has been transferred from Additional
Paid-In Capital to Preferred Stock. This has been done to reflect the par value
of all of the Company's Preferred Stock outstanding.
NOTE 12. LICENSE AGREEMENT
The Company executed a license agreement with Clark University for the exclusive
use of their patented technology in certain industries. The Company paid Twenty
Thousand Dollars ($20,000) for the use of this technology and will pay a royalty
to Clark University on products sold as a result of using the technology.
F-9
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> DEC-31-1997
<CASH> 242
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 242
<PP&E> 101,607
<DEPRECIATION> (21,118)
<TOTAL-ASSETS> 80,731
<CURRENT-LIABILITIES> 1,699
<BONDS> 0
0
6,000
<COMMON> 2,285
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 80,731
<SALES> 109
<TOTAL-REVENUES> 109
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 73,629
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (73,520)
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<NET-INCOME> (73,520)
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</TABLE>
